Sunday, May 27, 2012

There is an old saying they use to have in Soviet Russia. "They pretend to pay us and we pretend to work." This bears some thinking. Capitalism works when there is autonomy leading to motivation and resulting in accountability. And in today's market, dominated by corporate entities, the common clerk or local manager has little autonomy and thus, even less motivation to make a decision. Accountability in today's market is a depersonalized annual appraisal. Office Space, the movie, shows a new kind of Marxism in action. As a moderate Democrat, I can definitely understand why some Republicans get their dander up about over-regulation in some areas. Part of our employment problem, I think, is less about money and more about the pure hassle of getting a good employee to begin with and then getting rid of bad ones. And it is all tied into this question of autonomy and accountability, which has much larger ramifications for society and economy.
Marx was quite clear about the alienation that can come from mass production. Well, we are seeing the results in spades- in the service industry. In my case, I see it most immediately in my daily interactions which usually involve retailers. But I see it my office as well. We see this lack of accountability since 2008, in banks, insurance dealers, and the like. I am afraid capitalism and communism have become in essence the same thing by another means. I am sure this will spark some long-missing, lively blog discussion. But let us consider: What is the difference between a government centralizing production and prices and corporate entities that even if they don't totally control prices or production, are so big, they no longer respond to customers (i.e citizens) and who have monopolistic tendencies?
Here are some examples from my daily life-
1) I discovered last week that someone had paid off the $38K balance I still owe on my student loan. After a hear-racing moment, I called the USDE only to discover, like many others before me, that the USDE no longer administers my loan. It has now contracted out the Missouri Higher Education Loan Authority (MHELA)- a non-profit created specifically to get this kind of deal. This happened with no prior notice to me. Had I not chanced to log into my USDE account, I would not have known that the payment address and account number had totally changed. Good to know ahead of time, don't you think? "Doesn't my government owe me the courtesy of an explanation letter BEFORE they screw with the account", I ask the customer service rep. "Never mind," I say. It's not your fault."
2) Michaels: I was sent two coupons by Michaels, a chain craft store. One was for 50% off a regular priced item May 25-27th. The second was 20% off the entire purchase, but only good on Monday. So I took the 50% off coupon and selected my full price item. At the counter, I learn that the item is actually on sale (it wasn't marked as such on the shelf) so I can't use the coupon. The coupon would be a better deal than the sale price. "Can you take the 20% off today and I'll surrender the coupon?" "Nope. Come back tomorrow." "Forget it," I reply. They lost a $35 sale and the local and state government lost the tax revenue from the purchase. I won't be going back. No point telling the clerk off. It's not her fault. The store belongs to some distant entity, she pretends to work, and they pretend to pay her. I am sure she gets little better than minimum wage.
3) Staples: I am a photographer. I use a lot of ink. Staples use to give you $3 credit on recycled ink cartridges. You would take recycled cartridges in, buy new ink, and get an immediate price cut. No more I recently discovered. Now you have to go online, sign in, print a certificate (ironic considering you are now using the very ink you are trying to conserve, or you may not be able to print if you are out of ink) and bring it to the store when you want to buy your ink. I complain to the clerk, "So what used to be possible in one trip now takes 2 trips,and you are going to make me jump through hoops? That's not service. But I know, It's not your fault." She agreed it was dumb, and that it wasn't her fault. But it ensures that fewer people take advantage of the program. It is made to look like the company is giving you a deal, hoping that you won't actually take them up on it. It's like rebates that get advertised as sales
Get the theme? No one is a fault. We have a specal deal on boots today. Get in line. Yes, all of them are red and all them are size 12! But they are on special today! What does it remind you of?
Now let's look at how we shut a majority of people out of the system entirely- reverse discrimination. In an attempt to play by the numerous hiring rules, to avoid litigation, and to be sensitive to the less fortunate in society, we have succeeded in making hiring a nightmare for everyone. Since the very fact that I select means that I discriminate, then we prevent me from really selecting, but then try to hold me responsible for the outcome.
1)In my office, I want to hire someone to do a job. But I can't just hire someone who is qualified. This person must log on to a special website. Spend 60 minutes posting their information (we used to call it a "resume") and then wait for a confirmation number. This process has been streamlined substantially by the Obama Administration by the way. It used to take several hours. Then some computer system will filter all the candidates who applied for the job. I will get a list of people ranked based on their points. Points are given for veterans and current competitive service employees, disabilities, and god knows what else. After that, an only after that, do your qualifications count. Then we are told that we don't hire enough people with disabilities. And that while we don't have quotas, we have a goal of having 20% disabled on the staff. But we aren't allowed, I point out to ask on a form if someone is disabled. Yes, we are told, but the person can volunteer to declare themselves disabled. So, I point out, if you actually could get everyone currently on staff who is on Prozac to admit it, then we might actually exceed the "goal". I am told that this is true. So rather than selecting and being responsible for the selection, I need only ask for a list containing, excuse me for the crassness, a veteran with a gimpy leg or head injury of minority status. And then I can randomly choose 5 people an hope for the best. Because, after all, it won't be my fault. Who cares if the government gets stuck with some one of lesser qualifications, that they then can't fire even if performance is poor.
So I am looking around, and asking myself who is responsible? We have centralized so much, that some mystical, Kafkaesque emerald castle runs everything and we aren't sure who is behind the curtain. For any system to work, but particularly for capitalism to work, there must be a sense of responsibility and a sense of autonomy and accountability based on individual decisions. What we have now is defeatism, and a surrender of responsibility to computer systems and organizations where everyone is responsible, so no one is responsible. And don't even think of challenging the system too much. The Occupy Movement was the closest we got and it seems now invisible- the way the green revolution is in Iran, the protesters are in Russia now that Putin is elected.
When there is no autonomy, no one is responsible, and therefore, we pretend, and they pretend. How is it really differently from the system we claimed to defeat in 1989?

Good point about accountability. Your point is born out by the way that CEOs never seem to see their compensation or living standards suffer despite mismanagement of the companies they run. Golden parachutes and sky high salaries are a real problem when accountability is required for a smooth running market.

At the corporate level, when accountability for poor performance goes away, we get a tendency for bloated, inefficient companies that become increasingly dependent on government subsidies and bailouts. That might be why their incentives to spend money on lobbying is so high. They're so sloppy at making a profit in the real market that they need to capture the state to make the books balance.

But despite all that I'm not a fan of dark, cynical pessimism as expressed by Anonymous 1:35.

It's also about community buy-in to the system. Back in the 1980s and 1990s, there was this move to give line workers more autonomy to make spot decisions. And ther results were lauded from the mountian tops as a new era of empowerment. Now, it's just a word. It belies as lack of trust in people and failure of people to see how their actions and choices feedback into the larger whole. If this erodes too much, the capitalism replaces democracy rather than encouraging it.

I wouldn't call what we're talking about "capitalism." Capitalism is not simply the absence of government regulation or "anything goes" in business. Capitalism is a complicated network of laws and regulations designed to ensure property rights, enforcement of contracts, and importantly, accountability for business decisions should they turn out to be mistakes.

The domination of the state by corporate elites has more to do with the nastier, statist elements of fascism and corporatism than capitalism or a "free market."

What you are describing in the retail sector is why more and more of my purchases go online. Even when buying something off Amazon is arguably more expensive or I have to pay for shipping, it is worth it to me to avoid the hassle of driving to a store, expecting a bored and underpaid clerk to ring up my purchases before the Apocalypse, and schlepping the stuff home.

Ethically, I realize that a lot of online retailers have bad labor practices, but I can't see the point of patronizing brick and mortar stores with only marginally better records when I have to waste so.much.time. by going to stores in person.

I worry that in 20 years, it will just be convenience stores and dry cleaners.

Glad I found your blog and you have some really good insight here. To born to Republicans"I wouldn't call what we're talking about "capitalism." Capitalism is not simply the absence of government regulation or "anything goes" in business. Capitalism is a complicated network of laws and regulations designed to ensure property rights, enforcement of contracts, and importantly, accountability for business decisions should they turn out to be mistakes. " I could not agree more. As far as autonomy and accountability, when I first started working out of school I was given a good deal of autonomy and as a result responsibility now it seems the trend is reversed, there's no decision you can make without the approval of 2 layers above you. The organization is limited in what it can do to the bandwidth available to a handful of people. Its paralyzing and yes its very much like the politburo.

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